The Accounts Receivable Turnover Rate

question 84

Multiple Choice

The accounts receivable turnover rate:

• A)Indicates how many times the receivables were converted into cash during the year.
• B)Is computed by dividing average receivables by sales.
• C)Indicates the average number of days a business waits to make collection on a credit sale.
• D)Indicates the proportion of a company's accounts receivable that the independent auditors were unable to confirm.

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Definitions:

British Security

Financial instruments issued by the United Kingdom, including government bonds, stocks, and other securities, used for investment purposes.

Fixed Exchange Rate

A country's currency exchange rate regime under which the government or central bank ties the official exchange rate to another country's currency or to the price of gold.

Covariance

A measure of how two stocks move together, indicating the degree to which their returns are related.

Swiss Stock Exchange

A major stock exchange located in Zurich, known for its strict privacy laws and strong financial services sector.